RUPERT MURDOCH threw the newspaper industry into fresh turmoil last night by decreeing, after a discussion with Peter Stothard, editor of the Times, that weekday copies of the newspaper would cost 20p from this morning, the same price as his mass market Sun.

By slicing a further 10p off the paper's price (the Saturday paper comes down to 30p) what was once marketed as the top people's paper is surrendering an estimated further pounds 15m in lost revenue as it continues a long-term strategy of aiming to sell one million copies a day and eventual profit in perhaps five years time - the precise position of its arch-rival, the Daily Telegraph.

Peter Stothard said last night the move did not undermine the Times, by appearing to place it on a par with the Sun. 'The response from our readers so far is that they appreciated the paper at 30p. They thought a quality paper should be 30p.' He pointed to the strengths of the paper's columnists.

Stephen Grabiner, newly appointed managing director of the Daily Telegraph said: 'Is this sufficiently low to reflect the value of the Times? We think 30p is the right price for us, and we don't intend to change our position. We debated long and hard about whether to go to 35p, 30p or 25p. We knew that Rupert Murdoch would respond.'

Both groups are due to transfer their battle to the TV screens, launching large advertising campaigns, but the Daily Telegraph is partly funding this pounds 1m cost by cutting out the expensive offers of cut price holidays and cassette tapes it has been using to attract readers. It is also expected to examine budgets for cuts next year.

Max Hastings, editor of the Daily Telegraph, said he was in no doubt that cutting its price had been the right move. 'Murdoch has said he sees three national newspapers surviving, the Times, Daily Mail and the Sun. He is determined to take whatever action he can. We will not lie down in his path.' The Daily Telegraph is also preparing to add more right-wing political bite to its centre pages, through the appointment of a new deputy editor, Simon Heffer.

The Guardian, priced 45p, was silent on any future plans, as were the Daily Mail and Daily Express (both 32p), although Lord Rothermere, chairman of Associated Newspapers - which owns the extremely buoyant Daily Mail - is known to be actively considering how to respond.

Robert Thompson, deputy circulation manager at News International, said yesterday had seen a fair measure of dual newspaper purchasing by consumers as they sampled the cut-price paper: the Independent, at 20p for a day, was a beneficiary. The paper's own calculations showed a 68,000 rise in sales, to 331,000, while the Telegraph estimated its 30p offer had put on 5 per cent in extra sales. Sales of the Guardian and the Times were estimated to have fallen by about 65,000.

The moves have sent ripples throughout the industry, with large regional groups fearfully eyeing their prospects and prices. Magnus Linklater, editor of the Scotsman, published in Edinburgh and priced at 42p, said: 'The Telegraph is very much a major rival. We just can't stay out of it. At the moment we are holding our price.'